Suppose that a small county is considering adding a guard rail to a dangerous curve by a river. The guard rail will cost $70,000. The average damage done to vehicles that slide off the road at the curve is $10,000. It is expected that the guard rail will prevent 5 vehicles from sliding off the road during its usable life. What should the county do?

Question

Business

Marely Blanchard

1 April, 03:06

Suppose that a small county is considering adding a guard rail to a dangerous curve by a river. The guard rail will cost $70,000. The average damage done to vehicles that slide off the road at the curve is $10,000. It is expected that the guard rail will prevent 5 vehicles from sliding off the road during its usable life. What should the county do?

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Answers (1)

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Alvin Reilly · Answer 1

do not Install guard rail because the guard rail cost exceed the expected benefits

Explanation:

given data

guard rail cost = $70,000

average damage = $10,000

guard rail prevent = 5 vehicles

to find out

What should the county do

solution

we know here guard rail cost is $70,000

but expected benefits = $10,000 * 5

expected benefits = $50,000

so we can say that do not Install guard rail because the guard rail cost exceed the expected benefits